The historical sequence of events has been covered pretty well here. I wish to draw your notice to the qualitative thread that goes with it.
I think the central problem comes down to [u]attention span[/u]. Take a look at the chronology of the trends in music listed in the previous posts. I see a matching rise in the popularity of MTV, MuchMusic, and mindless entertainment in other fields, like movies (too tacky to merit the term 'cinema'). These visual forms all feature fast pacing, minimal plot, minimal audience engagement, and actually discourage any intellectual involvement.
The target audience for mass entertainment (in the Western world, at least) has been conditioned to expect big thrills without making any investment on their part. As someone said in another post, "Thinking is fun.". That is not a widely held opinion anymore. I believe that people get 'lost in thought' because its such unfamiliar territory.
The only hope for improvement is to prepare for the inevitable cyclic trend away from the current 'dumbing down' to something with more substance to it. The very fact we're having this discussion is encouraging. If enough people look elsewhere for entertainment, you can be sure The Biz will scramble to get out in front of 'The New Thing".